By: George M. Wilson & Carol A. Stacey
One of the most popular parts of the IPO on-ramp created by the JOBS Act allows Emerging Growth Companies (EGCs) to request confidential review of their initial 1933 Act registration statements. Confidential review allows EGCs to keep sensitive financial and other information out of the public spotlight until 15 days before they begin marketing their stock.
On June 29, the SEC announced that they will provide this kind of confidential review to all companies in the IPO process. The new benefit will begin July 10. Additionally, the SEC will also permit confidential review for most offerings made within one year of a company’s IPO. The Staff also posted FAQs related to the announcement.
New Chair Jay Clayton said this about the policy change:
“By expanding a popular JOBS Act benefit to all companies, we hope that the next American success story will look to our public markets when they need access to affordable capital. We are striving for efficiency in our processes to encourage more companies to consider going public, which can result in more choices for investors, job creation, and a stronger U.S. economy.”
Capital formation is an important part of the SEC’s mission, and this change clearly supports that process.
As always, your thoughts and comments are welcome!